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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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F O R M 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2004
MER TELEMANAGEMENT SOLUTIONS LTD.
(Name of Registrant)
22 Zarhin Street, Ra'anana 43662, Israel
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F __
Indicate by check mark if the registrant is submitting the
Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):__
Indicate by check mark if the registrant is submitting the
Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):__
Indicate by check mark whether by furnishing the information
contained in this Form, the registrant is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the Securities
Exchange Act of 1934.
Yes__ No X
If "Yes" is marked, indicate below the file number assigned to
the registrant in connection with Rule 12g3-2(b): 82-___________
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MER Telemangement Solutions Ltd.
6-K Items
1. Press Release re MTS Reports 9% Revenue Increase for Third Quarter
2004 dated November 10, 2004.
ITEM 1
Press Release Source: Mer Telemanagement Solutions Ltd.
MTS Reports 9% Revenue Increase for Third Quarter 2004
Wednesday November 10, 8:30 am ET
Revenues Grow 25% Sequentially
Key Investments in Sales and Marketing Infrastructure Continue
RA'ANANA, Israel, Nov. 10 /PRNewswire-FirstCall/ -- MTS - Mer Telemanagement
Solutions Ltd. (Nasdaq: MTSL - News), a global provider of Operations Support
Systems (OSS) for comprehensive Telecommunication Management and Customer Care &
Billing solutions, today reported its financial results for the third quarter
and nine months of 2004.
Revenues for the third quarter increased 9% to $2.5 million compared with $2.3
million for the third quarter of 2003, and grew 25% sequentially over second
quarter. Revenues for the nine months of 2004 were $6.8 million compared to $6.7
million for the prior year's period.
Eytan Bar, MTS's President and Chief Executive Officer commented: "We are
pleased with the sales momentum in the quarter. We signed new contracts and
continue to expand marketing channels with new and existing partners. Our
execution of the turnaround strategy and continued investments in sales and
marketing infrastructure are beginning to yield results."
The Company recently announced a partnership with NACR, the largest Avaya
certified Diamond & Platinum Business Partner and Three-Star Service Provider to
resell MTS' Application Suite to NACR's Avaya customers. The agreement will
provide a complete telemanagement solution including web-based reporting,
billback capacity and customer care. "Our objective is to enhance market
penetration by collaborating with leading telecommunications solutions
providers," said Mr. Bar.
Net loss for the quarter was $0.7 million or $(0.15) per share, compared with
net income of $3,000, or $0.00 per share, for the third quarter of 2003. Net
loss for the nine-month period of 2004 was $1.8 million or $(0.40) per share
compared to net income of $7,000 or $0.00 per share for the same period in 2003.
The Company's gross profit for the third quarter was flat at $1.8 million
compared to the third quarter of 2003. Nine-month gross profit was $5.1 million
compared to $5.3 million in the prior year's period.
Third quarter research and development expenses were consistent with the prior
year's quarter at $0.4 million. Research and development expenses for the nine
months of 2004 were $1.5 million compared to $1.3 million in the 2003 period.
Selling and marketing expenses for the quarter increased to $1.8 million from
$0.9 million in the third quarter of 2003. Nine-month selling and marketing
expenses were $4.3 million compared to $2.9 million for the nine months of 2003.
"We continue to add staff and infrastructure to our sales and marketing
functions as we position ourselves within our key target markets" stated Mr.
Bar. "Our goal is to drive sustainable revenue growth in the coming quarters and
future."
Operating loss for the quarter totaled $897,000 compared with $5,000 for the
third quarter of 2003. Operating loss for the nine-month period totaled $2.1
million compared to $0.2 million for the same period in 2003.
Yossi Brikman, Corporate COO & CFO, noted that the Company capitalized $386,000
in software development costs in accordance with applicable US GAAP guidelines
during the quarter. These costs are expected to be amortized over the life of
the technology developed, which is currently projected to be a period of three
years.
MTS ended the quarter with approximately $8.9 million in cash and cash
equivalents, including marketable securities.
The Company purchased 3,800 of its shares on the open market during the quarter
as part of its ongoing buyback program. At September 30, 2004, the Company had
4,638,004 shares outstanding.
"We are delivering on our strategic objectives," concluded Mr. Bar. "Sales are
ramping up and our infrastructure is developing nicely. We look forward to
continuing this trend in the coming quarters and stabilizing future investments
in line with growth of the overall business."
The Company will conduct a teleconference to discuss results today, Wednesday,
November 10, at 11:00 AM Eastern Time (18:00 Israel Time). To participate please
dial 1-800-792-0846 from the US or Canada (toll free), 1-800-945-7877 from
Israel (toll free), or 1-706-634-1485 from other locations approximately 5-10
minutes prior to the starting time. A replay of the call will be available from
2:00 PM ET on Wednesday, November 10, 2004, until 11:59 PM ET on Wednesday,
November 17. To access the replay please dial 1-800-642- 1687 from the US or
Canada (toll free), 1-800-945-8731 from Israel (toll free), or 1-706-645-9291
from other locations and enter conference ID# 1590683.
About MTS
Mer Telemanagement Solutions Ltd. is a global provider of operations support
systems (OSS) for comprehensive telecommunication management and customer care &
billing solutions. MTS' OSS is a full-featured customized solution for
telecommunications management and customer care & billing. Its
telecommunications enterprise resource planning (ERP) application suite is used
by corporations and organizations to improve the efficiency and performance of
all telecommunication and information technology (IT) operations, and to
significantly reduce associated costs. Its affordable customer care and billing
(CC&B) solutions are used by service providers and operators to support
sophisticated billing, web-based self-provisioning and other revenue-generating
applications.
Headquartered in Israel, MTS markets through wholly owned subsidiaries in the
U.S., Hong Kong, Holland, and Brazil, and through OEM partnerships with Siemens,
Phillips, and other PABX vendors. Its legacy call accounting solutions have been
installed by over 60,000 customers in 60 countries. MTS' shares are traded on
the NASDAQ SmallCap Market (symbol MTSL). For more information please visit the
MTS web site: http://www.mtsint.com
Certain matters discussed in this news release are forward-looking statements
that involve a number of risks and uncertainties including, but not limited to,
risks in product development plans and schedules, rapid technological change,
changes and delays in product approval and introduction, customer acceptance of
new products, the impact of competitive products and pricing, market acceptance,
the lengthy sales cycle, proprietary rights of the Company and its competitors,
risk of operations in Israel, government regulations, dependence on third
parties to manufacture products, general economic conditions and other risk
factors detailed in the Company's filings with the United States Securities and
Exchange Commission.
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
September 30, December 31,
2004 2003 2003
Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $7,459 $8,328 $8,684
Marketable securities 1,443 1,822 1,644
Trade receivables, net 1,320 1,102 1,391
Other accounts receivable and prepaid
expenses 674 377 566
Inventories 189 220 193
Total current assets 11,085 11,849 12,478
LONG-TERM INVESTMENTS:
Investments in an affiliate 1,926 1,687 1,859
Long-term loans, net of current
maturities 70 105 95
Severance pay fund 548 574 564
Other investments 373 369 368
Total long-term investments 2,917 2,735 2,886
PROPERTY AND EQUIPMENT, NET 539 524 482
OTHER ASSETS:
Goodwill 2,025 2,025 2,025
Capitalized software development costs 386 -- --
Other intangible assets, net 89 245 206
Deferred income taxes 105 169 105
Total other assets 2,605 2,439 2,336
Total assets $17,146 $17,547 $18,182
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except per share data)
September 30, December 31,
2004 2003 2003
Unaudited
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term loans $2 $8 $8
Trade payables 839 278 393
Accrued expenses and other liabilities 1,478 1,206 1,421
Deferred revenues 1,450 1,131 1,219
Total current liabilities 3,769 2,623 3,041
LONG-TERM LIABILITIES:
Long-term loans, net of current
maturities -- 2 --
Accrued severance pay 680 694 677
Total long-term liabilities 680 696 677
SHAREHOLDERS' EQUITY:
Share capital -
Ordinary shares of NIS 0.01 par value:
Authorized:
12,000,000 shares; Issued: 4,648,804,
4,565,138 and 4,631,471 shares at
September 30, 2004 and 2003 and
December 31, 2003, respectively;
Outstanding:
4,638,004, 4,562,038 and 4,624,471
shares at September 30, 2004 and
2003 and December 31, 2003,
respectively 14 14 14
Additional paid-in capital 12,654 12,603 12,603
Treasury shares (29) (7) (20)
Accumulated other comprehensive income(loss) 120 (82) 87
Retained earnings (accumulated deficit) (62) 1,700 1,780
Total shareholders' equity 12,697 14,228 14,464
Total liabilities and shareholders'
equity $17,146 $17,547 $18,182
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Nine months ended Three months ended Year ended
September 30, September 30, December 31,
2004 2003 2004 2003 2003
Unaudited
Revenues from products
and services $6,836 $6,719 $2,485 $2,286 $9,230
Cost of revenues from
products and services 1,721 1,408 674 457 1,849
Gross profit 5,115 5,311 1,811 1,829 7,381
Operating expenses:
Research and
development, net 1,517 1,261 414 434 1,825
Selling and marketing 4,284 2,917 1,762 938 3,916
General and
administrative 1,419 1,367 532 462 1,830
Total operating expenses 7,220 5,545 2,708 1,834 7,571
Operating loss (2,105) (234) (897) (5) (190)
Financial income
(expenses), net 46 27 27 (11) 124
Other income
(expenses), net (15) 6 15 -- 6
Loss before taxes on
income (2,074) (201) (855) (16) (60)
Taxes on income 3 96 1 98 198
(2,077) (297) (856) (114) (258)
Equity in earnings of
affiliate 235 304 140 117 345
Net income (loss) $(1,842) $ 7 $(716) $ 3 $ 87
Net earnings (loss) per share:
Basic and diluted net
earnings (loss) per
Ordinary share $(0.40) $ -- $(0.15) $ -- $0.02
Weighted average
number of Ordinary
shares used in
computing basic
earnings (loss) per
share 4,629,523 4,610,000 4,638,004 4,577,000 4,617,099
Weighted average
number of Ordinary
shares used in
computing diluted
earnings (loss) per
share 4,629,523 4,610,000 4,638,004 4,577,000 4,628,249
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MER TELEMANAGEMENT SOLUTIONS LTD.
(Registrant)
By: /s/Eytan Bar
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Eytan Bar
President and
Chief Executuve Officer
Date: November 10, 2004